Dismissed

V Shivashankarappa v. the Additional Chief Secretary to

Karnataka HC11 Oct 2023WP/2446/2023

Case brief

AI extract

What is this about?

The High Court of Karnataka dismissed a writ petition challenging tender conditions for KPTCL. The petitioners contested a 33% reservation quota for women and a 10% performance bank guarantee. The court held these conditions were compliant with government circulars and were not arbitrary.

What did the court decide?

None granted; both the 33% women reservation clause and the 10% performance bank guarantee condition were upheld.

V Shivashankarappa Vs the Additional Chief Secretary… — Company and Corporate | Karnataka HC (2023)

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 11^TH DAY OF OCTOBER, 2023

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BEFORE

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THE HON' BLE MR. JUSTICE R. DEVDAS

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WRIT PETITION NO. 2446 OF 2023 (GM-TEN)

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BETWEEN

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1 . V SHIVASHANKARAPPA AGED ABOUT 59 YEARS S/O N VEERABHADRAPPA M/S DELTA ELECTRICALS RESIDING AT NO.2508, 10TH MAIN D BLOCK, II STAGE RAJAJINAGAR BANGALORE-560010.

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2 . G P SUNIL KUMAR AGED ABOUT 41 YEARS S/O PUTTAMADAIAH M/S SHALINI ENTERPRISES RESIDING AT NO.23 3RD A CROSS KAMAKSHIPALYA BANGALORE-560079.

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3 . RAVIKUMAR N

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AGED ABOUT 40 YEARS S/O NARASIMHAPPA M/S SHREE CHETHANA ENTERPRISES RESIDING AT NO.26 1ST MAIN

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2ND CROSS MUNIKONDAPPA LAYOUT BAGALAGUNTE NAGASANDRA POST BANGALORE-560073.

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... PETITIONERS

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(BY SRI. H.C.SHIVARAMU, ADVOCATE)

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AND

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1 . THE ADDITIONAL CHIEF SECRETARY TO GOVERNMENT OF KARNATAKA DEPARTMENT OF ENERGY VIKAS SOUDHA BANGALORE-560001.

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2 . THE MANAGING DIRECTOR KARNATAKA POWER TRANSMISSION CORPORATION LIMITED CORPORATE OFFICE CAUVERY BHAVAN BANGALORE-560009.

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3 . THE DIRECTOR (TECHNICAL) KARNATAKA POWER TRANSMISSION CORPORATION LIMITED CORPORATE OFFICE CAUVERY BHAVAN BANGALORE-560009.

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THE SUPERINTENDING ENGINEER (ELE) TRANSMISSION (MAINT) BMAZ NORTH CIRCLE KARNATAKA POWER TRANSMISSION CORPORATION LIMITED ANANDA RAO CIRCLE BANGALORE-560009.

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THE SUPERINTENDING ENGINEER (ELE) TRANSMISSION (MAINT) BMAZ SOUTH CIRCLE

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KARNATAKA POWER TRANSMISSION CORPORATION LIMITED ANANDA RAO CIRCLE BANGALORE-560009.

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THE SUPERINTENDING ENGINEER (ELE) TRANSMISSION (MAINT) BMAZ RAMANAGARA CIRCLE KARNATAKA POWER TRANSMISSION CORPORATION LIMITED NEAR R.R. NAGAR ARCH, PANTHARA PALYA, MYSORE ROAD, BANGALORE-560009.

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THE SUPERINTENDING ENGINEER (ELE) TRANSMISSION (MAINT), BRAZ, KARNATAKA POWER TRANSMISSION CORPORATION LIMITED BRAZ, UAS CAMPUS, HEBBAL BANGALORE-560024.

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THE ADDITIONAL SECRETARY GOVERNMENT OF KARNATAKA DEPARTMENT OF LABOUR, VIKAS SOUDHA, BANGALORE.

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... RESPONDENTS

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(BY SRI. KIRAN KUMAR, HCGP FOR R1 & R8

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SMT. NAYANA TARA B.G., ADVOCATE FOR R2 & R7)

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THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE TENDER CONDITION / QUALIFICATION IN ITEM NO.6(i) AND 8(a) OF THE TENDER NOTIFICATION DTD 13.05.2022 AND 30.12.2022 ISSUED BY THE R2 PRODUCED AT ANNEXURE-D2 AND D1 AS IT BEING CONTRARY TO CIRCULAR DTD 01.09.2022 ISSUED BY

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THE R1 IN NO.KA E 105 LWA/2022 PRODUCED AT ANNEXURE-E DTD 01.09.2022 AND ETC.,

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THIS WRIT PETITION HAVING BEEN HEARD AND RESERVED ON 08.09.2023 AND COMING ON FOR PRONOUNCEMENT OF ORDERS, THIS DAY, THE COURT MADE THE FOLLOWING:

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ORDER

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This writ petition is filed by three petitioners, who claim to be licenced electrical contractors, who are also members of the Bangalore City Electrical and Civil Contractors Welfare Association. It is contended that they have been regularly participating in the tenders and have been providing trained workers to discharge the works of the respondent-Karnataka Power Transmission Corporation Limited (hereinafter referred to as ‘the Corporation’ for short). The writ petitioners are aggrieved of clause 6(i) and 8(a) of the impugned tender notifications dated 02.05.2022, 30.12.2022 and 13.05.2022/31.12.2022, at Annexure ‘D’, ‘D1’ and ‘D2’.

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Clause 6(i) stipulates that in terms of the Corporate Circular No.KPTCL/B14/526/2019-2020 dated 30.05.2022, the respondent-Corporation shall appoint 33% of women as mentioned in the circular. Clause 8(a) stipulates that the tenderer shall quote Performance Bank Guarantee as percentage of value of Annual Tender, provided that the percentage Performance Bank Guarantee shall not be less than 10%, else such a bid shall be rejected.

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Learned Counsel for the petitioners submits that the stipulation of reserving 33% of the works to women is without application of mind. It is contended that the nature of work to be performed under the tender notification would be in the sub-stations, which are located in remote and isolated places, without proper infrastructure and by their very nature the works are hazardous and the sub-stations are operated 24x7 and therefore, the workers are required to work in night shifts also. It is therefore contended that

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the stipulation that 33% of the workers shall be women, would be contrary to several judgments. It is submitted that the Madras High Court, in W.P.Nos.4604-4606/2009 declared Section 66(1)(b) of the Factories Act, 1948 as unconstitutional, since it is violative of Articles 14, 15 and 16 of the Constitution of India. It was held that employment of women in factories in the night shift can only be under certain conditions of fulfillment of proper security and safety measures. In that regard, it was directed that the employer shall ensure that the women workers are employed in a batch not less than ten and the total number of women workers employed in a night shift shall not be less than two-third of the total strength.

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It is submitted that Section 25 of the Shops and Commercial Establishments Act, 1961, would prescribe that a woman employee who is so willing, may be allowed to work in a shop or commercial establishment during night, subject to certain conditions.

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Learned Counsel draws the attention of this Court to Annexure ‘F’, which is a representation dated 14.09.2022 given by the Bangalore City Electrical and Civil Contractors Welfare Association to the Managing Director of the respondent-Corporation, requesting the Managing Director to consider the grievance of the Contractors in respect of the two clauses impugned herein. It is submitted that consequent to the representation given by the Association, the Chief Manager (Technical), KPTCL gave a reply dated 07.12.2022 at Annexure ‘F1’ quoting several other provisions of law and thereby rejecting the request made by the Association.

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However, learned Counsel for the petitioners has drawn the attention of this Court to a Government Order dated 23.05.2015 issued by the Energy Department, while directing that there shall be relaxation of the requirement of providing 30% reservation in the matter of employment of women in the cadre of Guides (Margadaalu) and Station

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Supervisors. It is further contended that even as per the statement of objections filed at the hands of the respondent-Corporation, it is admitted by the respondents that in the matter of deployment of qualified personnel through manpower agencies, the tender document will be issued in terms of the tender documents of the Rajiv Gandhi Rural Housing Corporation Limited. Such a statement is made in paragraph-14 of the statement of objections. However, the two impugned conditions are not found in the tender documents of the Rajiv Gandhi Rural Housing Corporation Limited.

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Similarly, it is submitted that the requirement in terms of clause 8(a) of the impugned tender notifications are also not in consonance with the terms and conditions contained in the tender documents issued by the Rajiv Gandhi Rural Housing Corporation Limited. Learned Counsel would submit that never earlier was such a condition imposed in the matter of providing Performance Bank

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Guarantee in the matter of providing qualified personnel, while inviting tenders from manpower agencies. It is submitted that these conditions are calculatedly imposed in the impugned notifications only to keep away small contractors like the petitioners. The impugned clauses are biased and accentuated to restrict the tenders to big contractors. The learned Counsel therefore, submits that the two impugned conditions are arbitrary, unreasonable, inserted with mala fide intentions and therefore, the impugned notifications are required to be struck down or a direction may be issued to the respondent-Corporation not to insist upon the two impugned clauses.

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Per contra, learned Counsel for the respondent-

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Corporation seeks to clarify the position regarding the requirement of 33% women workers, by drawing the attention of this Court to Annexure ‘C’, Circular dated 19.05.2022 and submits that the requirement of having 33% of women employees/workers is restricted to Group

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‘D’ posts only and does not pertain to the Shift Engineers Grade-I and Grade-II, which are not in the cadre of Group ‘D’. Moreover, the petitioners have not questioned the Government Circular dated 30.05.2022 which mandates such requirement of having 33% of women workers. In the absence of any challenge raised to the Government Circular, the petitioners cannot find fault with the impugned notifications, which are compliant with the Government circular dated 30.05.2022.

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Learned Counsel would submit that insofar as the Group ‘D’ employees are concerned and in terms of the impugned notifications, where the housekeeping and Operation and maintenance Helpers are concerned, the housekeeping service is not engaged in night shift and therefore, the apprehension of the petitioners is unfounded. Insofar as the Operation and Maintenance Helpers are concerned, it is submitted that the women working as O & M Helpers would be given the option of working only during

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the day time. Even otherwise, if the women workers choose to work in night shift, all safety and security measures will be taken by the respondent-Corporation, including providing dedicated security guards.

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As regards the Performance Bank Guarantee is concerned, learned Counsel submits that even in the tender documents of the Rajiv Gandhi Rural Housing Corporation Limited, such a condition has been imposed. It is in the matter of these conditions, that a decision was taken by the respondent-Corporation that it would follow the tender conditions imposed in the tender documents of the Rajiv Gandhi Rural Housing Corporation Limited. It is submitted that 10% of the Performance Bank Guarantee in terms of the impugned notifications would be around Rs.4 lakhs and Rs.8 lakhs which cannot be termed as exaggerated, prohibitive or arbitrary, as claimed by the petitioners. It is submitted that the said requirement is in-line with the

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rationale for demanding a performance bank guarantee and will be refunded in full, if there are no deductions.

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Learned Counsel for the respondent-Corporation seeks to place reliance on a decision of the Hon’ble Supreme Court in the case of Airport Authority of India Vs. Centre for Aviation Policy, Safety & Research (CAPSR) & Others , 2022 SCC OnLine SC 1334 , to contend that it is a settled position of law that the terms and conditions of the invitation to tender are within the domain of the tender making authority and such conditions are not open to judicial scrutiny, unless they are arbitrary, discriminatory or mala fide .

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Heard the learned Counsel for the petitioners, learned Counsel for the respondent-Corporation and perused the petition papers.

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In a writ petition of such nature, where the writ petitioners seek to raise a challenge to a particular clause of the tender notification, it is not sufficient to contend that

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the offending clause creates hardship to the writ petitioners. As rightly contended by the learned Counsel for the respondent-Corporation, the law is by now well settled that while exercising the powers under Article 226 of the Constitution of India, the discretion vested with this Court can be exercised only if this court is convinced that the impugned terms and conditions are arbitrary, discriminatory or mala fide . Normally, the terms of the tender notification are not open to judicial scrutiny, since they are in realm of contract. The Apex Court has held that the Government / Tenderer must have a free hand in setting the terms of the tender. All that the participating bidder is entitled to is a fair, equal and non-discriminatory treatment in the matter of evaluation of their tenders. This implies that terms subject to which tenders are invited are not open to judicial scrutiny unless it is found that the same have been tailor-made to benefit any particular tenderer or

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class of tenderers. Another decision in the case of

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Michigan Rubber (India) Limited Vs. State of

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Karnataka (2012) 8 SCC 216 , has also been referred in the said decision in Airport Authority of India (supra). The principles laid down in the matter of government tenders have been extracted as follows:

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“23. From the above decisions, the following principles emerge:

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(a) The basic requirement of Article 14 is fairness in action by the State, and non-arbitrariness in essence and substance is the heartbeat of fair play. These actions are amenable to the judicial review only to the extent that the State must act validly for a discernible reason and not whimsically for any ulterior purpose. If the State acts within the bounds of reasonableness, it would be legitimate to take into consideration the national priorities;

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(b) Fixation of a value of the tender is entirely within the purview of the executive and the courts hardly have any role to play in this process except for striking down such action of the

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executive as is proved to be arbitrary or unreasonable. If the Government acts in conformity with certain healthy standards and norms such as awarding of contracts by inviting tenders, in those circumstances, the interference by courts is very limited;

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(c) In the matter of formulating conditions of a tender document and awarding a contract, greater latitude is required to be conceded to the State authorities unless the action of the tendering authority is found to be malicious and a misuse of its statutory powers, interference by courts is not warranted;

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(d) Certain preconditions or qualifications for tenders have to be laid down to ensure that the contractor has the capacity and the resources to successfully execute the work; and

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(e) If the State or its instrumentalities act reasonably, fairly and in public interest in awarding contract, here again, interference by court is very restrictive since no person can

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claim a fundamental right to carry on business with the Government.”

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31. In the aforesaid decision, it is further observed that the Government and their undertakings must have a free hand in setting terms of the tender and only if it is arbitrary, discriminatory, mala fide or actuated by bias, the courts would interfere. It is further observed that the courts cannot interfere with the terms of the tender prescribed by the Government because it feels that some other terms in the tender would have been fair, wiser or logical.”

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Having regard to the above stated principles, this Court finds that the requirement of having 33% of women workers in Group ‘D’ posts, in the respondent-Corporation, cannot be termed as arbitrary, discriminatory or mala fide . In fact, such stipulations are in advancement of the progressive thinking of providing equal opportunity of employment to women. As rightly contended by the learned Counsel for the respondent-Corporation, such stipulations in the impugned notifications are in compliance

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of the Government Circular dated 30.05.2022 and there is

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no challenge raised to the Government Circular.

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The other contention regarding the stipulation of offering 10% of the Performance Bank Guarantee also cannot be termed as arbitrary, discriminatory or mala fide . The decision taken by the respondent-Corporation to issue a tender notification in consonance with the tender documents of the Rajiv Gandhi Rural Housing Corporation Limited can also be traced to such stipulations contained in the tender document of Rajiv Gandhi Rural Housing Corporation Limited. This Court can also take judicial notice of the fact that such stipulations for furnishing Performance Bank Guarantee is a common criteria that can be found in the tender documents issued by the concerned governments or government owned companies.

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For the reasons stated above, this Court is of the considered opinion that there is no merit in the writ petition.

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Consequently, the writ petition stands dismissed .

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Pending I.As., if any, stand dismissed.

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Sd/JUDGE

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JT/DL

V Shivashankarappa v. the Additional Chief Secretary to

Case brief

What is this about?

What did the court decide?

V Shivashankarappa v. the Additional Chief Secretary to

Case brief

What is this about?

What did the court decide?

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